It has been known for many years that infants reared on cow's milk were more likely to develop iron deficiency than on human milk. Previously, this has been attributed to an intestinal allergy to cow's milk which caused subclinical bleeding from the gut. Since calcium is a divalent metal, we believed it was more likely that calcium inhibited iron absorption and that a more profound effect would be observed with cow's milk because it has four times the calcium concentration of human milk (30 mM/1 vs. 7 mM/1). Studies in rats showed that the addition of calcium to test doses of radioiron produced a dose related diminution in iron absorption. Ultrastructural studies of duodenal mucosal cells which had been exposed to iron with and without the addition of calcium chloride demonstrated a diminution of iron uptake by the intestinal microvilli. Studies of radioiron retention in intestinal mucosa at intervals after exposure to a test dose showed that duodenal mucosal retention of radioiron decreased less rapidly in the presence of iron. Thus, calcium appears to diminish both the mucosal uptake and transfer of iron. Subcellular fractionation studies of intestinal mucosa show a diminution in the proportion of iron in the soluble crytosol fractions in the presence of calcium suggesting competition for different receptors in the cell by the two metals. Rats fed a high calcium iron-replete diet for one month had significantly diminished quantities of stainable iron in body stores. Similarly, rats consuming a high calcium diet with marginal quantities of iron developed iron deficiency whereas this was not observed in animals fed an identical diet except for a reduction in the calcium content. Measurements of iron absorption from test doses of human milk and cow's milk to which radioiron was added showed diminished absorption from the cow's milk. Further, the addition of sufficient calcium chloride to human milk to bring it to the concentration of cow's milk produced a decrease in iron absorption similar to that observed when radioiron was administered in cow's milk. We believe these observations explain the increased prevalence of iron deficiency anemia in infants reared on cow's milk rather than human milk and that studies of the competition which exists between iron and calcium in intestinal cells may be helpful in delineating the mechanisms which regulate iron absorption.